CALIFORNIA DISPUTE RESOLUTION COUNCIL BYLAWS
(with Amendments as adopted November 4, 2004)
Article 01: Organization Article 02: Purposes Article 03: Membership Article 04: Privileges and Obligations Article 05: Finances Article 06: Officers Article 07: Board of Directors Article 08: Executive Committee Article 09: Meetings Article 10: Committees Article 11: Fiscal and Elective Year Article 12: Amendments Article 13: Miscellaneous Article 14: Indemnification
ARTICLE 1: ORGANIZATION
Section 1.1 Name. The name of this organization is the California Dispute Resolution Council, hereinafter referred to as the Council.
Section 1.2 Place of Business. The principal place of business of the Council shall be in California at such place or places as may be designated by the membership or its Board of Directors.
Section 1.3 Dispute Resolution. Dispute Resolution as used herein includes mediation, arbitration, neutral evaluation, facilitation, conciliation and other means of resolving disputes without litigation.
ARTICLE 2: PURPOSES
Section 2.1 Purposes. The purposes of the Council are:
a. To develop, support, and influence statewide public policies which promote effective and accessible conflict resolution services and to coordinate statewide efforts to that end;
b. To unite, for the purposes stated in this Article, those engaged in providing Dispute Resolution services (defined as including mediation, arbitration, neutral case evaluation, facilitation and other means of resolving disputes and handling conflicts other than by litigation) within the State of California;
c. To promote high standards of conduct in the Dispute Resolution profession and by those who provide such services within the State of California;
d. To further the interests of providers and users of Dispute Resolution services by providing a forum for building consensus on the principles and policies to guide the use and practice of Dispute Resolution in California.
Section 2.2 Principles. The Council may also adopt or endorse Principles for the guidance of the Council and its membership provided that the Principles are in accordance with the Purposes.
Section 2.3 Standards. The Council may also adopt or endorse Standards for the guidance of Dispute Resolution neutrals provided that the Standards are in accordance with the Purposes.
ARTICLE 3: MEMBERSHIP
Section 3.1 Categories. There shall be two categories of membership, Active and Affiliate.
a. Active. Active Members shall include Dispute Resolution service providers, practitioners, educators, administrators and trainers, individually or by organization.
i. Organization. Active Organizational Members shall be either voting or non-voting members, depending on the organization they represent. Non-voting Active Organizational Members shall not be entitled to vote on legislative matters but shall be entitled to vote for the election of Directors, amendment of Bylaws and other non-legislative matters.
ii. Individual. All Active Individual Members shall be voting members.
b. Affiliate. Affiliate Members shall be individuals or organizations who support the Council Purposes and shall be nonvoting members.
Section 3.2 Levels of Membership. Within each Category of membership the Board of Directors may designate Levels of membership and dues for each such Level.
Section 3.3 Application. Applications for membership shall be made in such manner, form and content as prescribed by the Board of Directors or its Executive Committee and be made available to anyone requesting them. The Application shall indicate the Purposes of the Council.
ARTICLE 4: PRIVILEGES AND OBLIGATIONS
Section 4. 1. The privileges and obligations of members, in addition to those otherwise provided in these Bylaws, shall be specified in this Article.
Section 4.2 Voting. Voting rights of the general membership of the Council shall be limited to those matters which the Board of Directors in its discretion may submit to the general membership, approval or rejection of such matters to be indicated by a majority of those voting members voting unless otherwise specified.
Section 4.3. Notwithstanding Section 4.2 and subject to the limitations imposed by Section 4.5, Active Members shall be entitled to vote on any amendment to the Bylaws and for the election of members of the Board of Directors.
Section 4.4 Active Members. Members who have paid the required dues in accordance with these Bylaws and who are not suspended shall be members in good standing. Only Active Members in good standing shall be entitled to vote or hold elective office in the Council.
Section 4.5 Affiliate Members. Affiliate Members shall have such rights and privileges (except the right to vote and hold elective office) and be subject to such obligations and may be prescribed by the Board of Directors.
Section 4.6. Each person who is a member shall have only one vote regardless of how many positions or offices held that entitles that person to vote, whether as a member or as a member of the Board of Directors.
Section 4.7 Non-transferability. No membership or right arising from membership shall be transferred. All membership rights cease on the member’s death or dissolution.
ARTICLE 5: FINANCES
Section 5. 1 Dues and Fees. Application fees and annual dues may be established by the Board of Directors in amounts and payable as and when it deems appropriate.
Section 5.2 Depository. All monies received by the Council for any purpose shall be promptly deposited to the credit of the Council in a financial institution or institutions selected by the Board of Directors.
Section 5.3 Expenditures. The Board of Directors shall administer the finances of the Council.
ARTICLE 6: OFFICERS
Section 6. 1 Officers. The Officers of the Council shall be a President, President-Elect, Secretary and Treasurer. They shall be elected for terms of one year except for the President who will have the option of extending the term for a second year upon approval by vote of the Board.
Section 6.2 President. The President shall be the chief executive officer of the Council and shall:
a. Act as spokesperson for the Council as authorized by the Board;
b. Appoint the Chairpersons of all Standing and Special Committees subject to confirmation by the Board of Directors;
c. Cause meetings to be called as provided in these Bylaws and preside at all regular and special meetings of the Membership and Board of Directors;
d. Perform all other duties usually incident to that office or as assigned by the Board of Directors;
e. Call an annual meeting of the Council Membership for the purpose of rendering a report of the annual activities and status of the Council and submitting such recommendations as the President or Board of Directors may suggest and for such other purposes as the President or Board of Directors may deem necessary.
Section 6.3 President-Elect. The President-Elect shall, in the absence of the President or, in case of the inability, refusal or neglect of the President to act, perform the duties of the President as directed by the Board of Directors.
Section 6.4 Secretary. The Secretary shall keep, or cause to be kept, at the principal office of the Council a:
a. Minute Book. Minute Book containing the Council’s Articles of Incorporation, Bylaws, Minutes of meetings of the Board of Directors and Membership, and such other matters as the Board of Directors may direct.
b. Membership Roster. Membership Roster showing the names, addresses and classification of all Members and dates of membership termination.
Section 6.5 Treasurer. The Treasurer shall:
a. Maintain adequate and correct accounts of properties and business transactions of the Council;
b. Deposit or cause to be deposited, all monies and other valuables in the name and to the credit of the Council with such depositories as may be designated, from time to time by the Board of Directors, and shall disburse the funds of the Council as may be ordered by the Board of Directors;
c. Together with such other officers or persons as may be designated by the Board of Directors, sign all checks drawn in the name of the Council; and
d. Distribute or caused to be distributed an annual financial statement to the Board of Directors and to make available such statement to any Member upon request of such Member.
ARTICLE 7: BOARD OF DIRECTORS
Section 7. 1 Authority. The authority for the administration of the affairs of the corporation in their entirety shall be vested in the Board of Directors (referred to sometimes herein as the Board). The total number of authorized Directors for the Council shall be no less than 15 and no more than 27.
Section 7.2 Requisite Status. All directors must, by membership classification, be Active Members and be natural persons.
Section 7.3 Powers. The Board, in addition to the powers set forth in the Bylaws, shall have the following, powers, to wit:
a. To select and remove all the officers, agents and employees of the Council, prescribe such powers and duties for them as may not be inconsistent with law or the Bylaws, fix their compensation, and require security for faithful service,
b. To have charge of funds and property of the Council, and may invest them in such a manner as shall be determined in the best interests of the Council.
c. To approve the appointments made by the President of all Standing and Special Committee chairs and, upon request of the President, to remove same when necessary, to appoint any representative of the Council to, or as an officer in, any other organization with which the Council may become affiliated subject to the Bylaws of such other organizations;
d. To adopt an annual budget as soon as practicable after the beginning of the fiscal year which shall be a guideline for the financial activities of the Council. In addition, the outgoing Board shall submit any budget recommendations to the incoming Board on or before the last day of the fiscal year;
e. To set a regular time and place for meetings of the general membership and the Board, to prescribe the number of members of all Standing and Special Committees with their purposes, powers and responsibilities; and
f. To investigate infractions of these Bylaws and to insure strict compliance with them by all members of the Council.
Section 7.4 Term of Office. Members of the Board shall serve for terms of three (3) successive calendar years. The term of an individual who is elected President-elect shall be extended while that individual serves as President-elect, President and Immediate Past-President. No individual shall serve more than two (2) consecutive terms of any length as a director, provided that an individual who is elected President-elect shall be eligible for an election to an additional three (3) year term after serving as President-elect, President and Immediate Past-President unless, upon completion of such term, the individual will have served more than nine (9) consecutive years on the Board. An individual who has served for two (2) consecutive terms as a director shall be eligible again be eligible for election to the Board after the expiration of one (1) year following the completion of his or her most recent term. No more than two (2) persons who are owners of or employed by any one provider firm or organization shall be eligible to serve concurrently on the Board.
Section 7.5 Vacancies. Vacancies among the officers and the Board shall be filled by the Board from among the members of the Council who qualify.
Section 7.6 Election Procedure.
a. The Nominating Committee for each fiscal year shall consist of the Immediate Past President who will act as chairperson, the current President and no fewer than three other active members selected by the Immediate Past President.
b. At least forty-five (45) days prior to the annual election, the Nominating Committee shall meet or otherwise confer and nominate from the roster of eligible members one or more eligible candidates for each vacancy to be filled on the Board for the ensuing term. The Nominating Committee shall consider all relevant diversity factors including geographic, cultural, gender, organization, practice area and membership classification in selecting nominees.
The Nominating Committee shall determine that each candidate is able and willing to serve and is qualified according to the Bylaws, and submit a list of its candidates direct to the Secretary of the Council who will immediately publish the list to the membership in alphabetic order.
c. The Secretary of the Council shall publish the names of the eligible nominees, who are willing and able to serve, to each active member at least thirty (30) days prior to the election.
i. The President shall appoint an Election Committee, subject to the approval of the Board, composed of at least three members qualified to vote to conduct the election, count the ballots and secure the integrity of the ballot box.
ii. Active Members shall have one vote for each vacancy.
iii. No other category of membership shall have the right to vote.
iv. The candidates receiving the greatest number of votes shall be declared elected. In the event of a tie between two or more candidates there shall be one or more subsequent ballots to determine which candidate is elected. The qualified voters then present shall be a sufficient number to elect.
v. Manner of Voting. The vote of any member shall be by written ballot. That ballot and any related material may be sent by electronic transmission by the corporation (Section 20 of the California Corporations Code), and responses may be returned to the corporation by electronic transmission to the corporation (Section 21of the California Corporations Code). A written ballot may not be revoked. No member shall vote by proxy.
vi. If the vacancies to be filled by the election are for different terms, the candidates shall be elected in order of number of votes received to the longest term first and then the shorter term(s) until all vacancies are filled.
Section 7.7 Election of Officers and Approval of Committee Chairs.
a. Election of Officers. At the last meeting of the Board of Directors in each fiscal year or any adjournment thereof, the members of the Board shall elect a President, a President-Elect, a Secretary and a Treasurer for the next fiscal year and to serve until the election and qualification of their respective successors. At any such meeting, a quorum having been established, such officers shall be elected by a majority of the directors then present. The Nominating Committee provided for in Section 7.6(b) shall confer and make recommendations for such officers, which recommendations shall be transmitted to the Board of Directors at least 20 days prior to the meeting at which the election is to take place.”
b. Appointment of Committee Chairs. The Directors elected to serve as the Board of Directors for the new term shall have authority prior to induction to approve the newly elected President's choice of committee chairs.
Section 7.8 Qualifications for Director. Candidates for Director shall be an active members and shall be able and willing to serve as a Director.
Section 7.9 Absences from Meetings. Absences from all regular Board meetings in one calendar year without reasonable cause and prior notice to the President shall be construed as a resignation from the Board.
ARTICLE 8: EXECUTIVE COMMITTEE
Section 8.1 Authority. The Executive Committee shall have such duties and authority as may be established by these Bylaws and by action of the Board of Directors. If the Board of Directors does not designate Executive Committee Authority at the first regular meeting of the Board, each year, then the Executive Committee’s Authority shall consist of that outlined below in 8.1 a. The Executive committee shall carry out any and all recommendations and instructions from the Board; function as an advisory committee to the President of the council; and oversee and assure that the policies of the Council are established by the Board of Directors are being properly implemented.
a. Executive Committee Authority. If the Board of Directors does not designate Executive Committee Authority at its first regular meeting of the year, or at anytime thereafter, the Executive Committee shall have the authority to consider and decide those matters that require decision or action (emergencies or time sensitive legislative matters) prior to the next regularly scheduled Board meeting, including, without limitation, the filling of vacancies on the Board or those matters directly referred to the Executive Committee by a majority of the Board, subject to the exceptions of Section 12.1 b.
i. Executive Committee meetings shall be called by the President. Such meetings shall be called by giving notice to all Board Members that gives as much notice as possible, if any, by whatever method is chosen by the President (e-mail, telephone, facsimile).
ii. Minutes of Executive Committee Meetings shall be e-mailed to all Board Members within one week of the Executive Committee Meeting, or minutes shall be provided at the next regular scheduled Board meeting, whichever is earlier.
iii. This section does not derogate from the authority granted to the President, as provided in Section 6.2 of these by-laws.
Section 8.2 Composition and Selection. The Executive Committee shall consist of the President, President-Elect, Immediate Past President, Secretary, Treasurer and two additional members both of whom must be members of the Board appointed by the Board of Directors on an annual basis.
Section 8.3 Quorum. A majority of the members of the Executive Committee shall constitute a quorum for the transaction of business.
Section 8.4 Term of Office. The term of office of each member of the Executive Committee shall be one year or until that member's successor is confirmed. A member may succeed himself/herself in office.
Section 8.5 Vacancies. Vacancies caused by the resignation of a member of the Executive Committee shall be filled by a vote of the Board. A successor so selected shall serve for the unexpired term of the member who resigned. Members of the Executive Committee may be removed with or without cause by the Board of Directors.
Section 8.6 Special Meetings. Special meetings of the Executive Committee may be called at any time by the President or by a majority of the officers. Written notice shall be mailed or otherwise delivered at least five days before the time of holding the meeting. The transactions of any meeting of the Executive Committee shall be as valid as though made at a meeting held after regular call and notice notwithstanding lack of or defective notice, if a quorum is present and if either before or after the meeting each of the members not present signs a written waiver of notice or a consent to hold the meeting or an approval of the minutes. All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting.
Section 8.7 Place of Meeting. Regular meetings of the Executive Committee shall be held at any place, within or without the state, that may be designated by the President. In the absence of this designation, regular meetings shall be held at the principal office of the corporation. Special meetings may be held either at a place designated or at the principal office. Regular and special meetings of the Executive Committee may take place through use of conference telephone, electronic video screen communication or electronic transmission by and to the corporation (as provided by Sections 20 and 21 of the Corporations Code). Participation in a meeting through use of conference telephone or electronic video screen communication pursuant to this Subsection constitutes presence in person at that meeting as long as all members participating in the meeting are able to hear one another. Participation in a meeting through use of electronic transmission by and to the corporation, other than conference telephone and electronic video screen communication pursuant to this Subsection constitutes presence in person in that meeting if both of the following apply:
(i) Each member participating in the meeting can communicate with all of the other members concurrently.
(ii) Each member is provided the means of participating in all matters before the Executive Committee, including, without limitation, the capacity to propose, or to interpose an objection to, a specific action to be taken by the Executive Committee.
Section 8.8 Action Without A Meeting. Any action by the Executive Committee may be taken without a meeting if all members of the committee individually or collectively consent in writing to this action. Such written consent or consents shall be filed with the minutes of the proceedings of the Board prior to the next Board meeting.
ARTICLE 9: MEETINGS
Section 9. 1 Meetings of the Board.
a. Regular Meetings. Regular meetings of the Board shall be held at least twice a year, one of which shall be held in conjunction with a general membership meeting at such locations within or without the State and times as designated by the President or Executive Committee or the Board.
b. Special Meetings. Special meetings of the Board may be called by the President or any one-third of the other Directors, the time, place and purpose to be designated in the call.
c. Members of the Board may participate in a meeting through use of conference telephone, electronic video screen communication or electronic transmission by and to the corporation (as provided by Sections 20 and 21 of the Corporations Code). Participation in a meeting through use of conference telephone or electronic video screen communication pursuant to this Subsection constitutes presence in person at that meeting as long as all members participating in the meeting are able to hear one another. Participation in a meeting through use of electronic transmission by and to the corporation, other than conference telephone and electronic video screen communication pursuant to this Subsection constitutes presence in person in that meeting if both of the following apply:d. Subject to the power of the Board to conduct closed Board meetings, members of the Council and other persons invited to do so by the Board may attend regular and special Board meetings.
(i) Each member participating in the meeting can communicate with all of the other members concurrently.
(ii) Each member is provided the means of participating in all matters before the Board, including, without limitation, the capacity to propose, or to interpose an objection to, a specific action to be taken by the Board.
Section 9.2 Quorum - Directors' Meetings.
a. A majority of the authorized number of directors shall constituter a quorum for the transaction of any business except adjournment. Every action taken or decision made by a majority of the directors present at a duly held meeting at which a quorum is present shall be an act of the Board, subject to the more stringent provisions of the California Nonprofit Public Benefit Corporation Law, including, without limitation, those provisions relating to (a) approval of contracts or transactions in which a director has a direct or indirect material financial interest, (b) approval of certain transactions between corporations having common directorships, (c) creation of and appointments to committees of the Board, and (d) indemnification of directors. A meeting at which a quorum is initially present may continue to transact business, despite the withdrawal of some directors from that meeting, if any action taken or decision made is approved by at least a majority of the required quorum for that meeting.
b. Notice of a meeting need not be given to any director who, either before or after a meeting, signs a waiver of notice, a written consent to the holding of the meeting, or an approval of the minutes of the meeting. The waiver of notice or consent need not specify the purpose of the meeting. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meetings. Notice of a meeting need not be given to any director who attends the meeting and who, before or at the beginning of the meeting, does not protest the lack of notice to him or her.
c. Notice of the time and place of holding an adjourned meeting need not be given unless the original meeting is adjourned by more than 24 hours. If the original meeting is adjourned for more than 24 hours, notice of any adjournment to another time and placed shall be given, before the time of the adjourned meeting, to the directors who were not present at the time of the adjournment.
d. A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place.
Section 9.3 Action Without a Meeting. Any action that the Board is required or permitted to take may be taken without a meeting if all Board members consent in writing to the action; provided, however, that the consent of any director who has a material financial interest in a transaction to which the corporation is a party and who is an “interested director” as defined in Corporation Code section 5233 shall not be required for approval of that transaction. Such action by written consent shall have the same force and effect as any other validly approved action of the Board. All such consents shall be filed with the minutes of the proceedings of the Board.
Section 9.4 General Membership Meetings.
a. Regular Membership Meetings. Regular membership meetings shall be held at least annually, the time and place thereof to be determined by the Board.
b. Special Membership Meetings. A special membership meeting may be convened by the president and one-third of the Directors, or upon the written request of fifteen percent of the active members in good standing. Notice of this meeting shall be given to each member.
c. Quorum. At any membership meeting of this Council, the number of active members necessary to constitute a quorum shall be at least fifteen percent (15%) of the combined total of such members then in good standing in the Council.
ARTICLE 10: COMMITTEES
Section 10.1 Standing Committees. Committees established to handle the ongoing operations of the Council shall be classified as Standing Committees. Standing Committees may be created or eliminated by the Board of Directors.
Section 10.2 Standing Committee Chairs. The President shall appoint committee chairs to serve on Standing Committees. The Chairs may accept sign-ups for and/or make appointments to the Standing Committees.
Section 10.3 Task Forces. The President may appoint, subject to the approval of the Board of Directors, Task Forces to address short term issues of importance requiring timely action and special expertise. The Chair, Vice Chair(s), and members of such Task Force shall be appointed by the President. The President will identify the specific goals which the Task Force is being appointed to fulfill, and a designated time certain for the fulfillment of these goals. The Task Force and all appointments thereto will automatically terminate at the end of the designated time or upon action by the Board.
Section 10.4 Vacancies. The Board, acting through the President, shall have power to remove or reinstate any Standing Committee member with or without cause. The Board shall have the power to remove any member of a Task Force with or without cause. The President shall fill any vacancies by appointment for the unexpired term.
Section 10.5 Authority. Except as otherwise authorized by the Bylaws, any action by a Committee or Task Force shall be subject to the approval of the Board.
Section 10.6 President. The President shall be ex-officio member of all Standing Committees and Task Forces and shall be notified of their meetings.
ARTICLE 11: FISCAL AND ELECTIVE YEAR
Section 11.1 Fiscal Year. The fiscal year of the Council shall be the calendar year. The members of the Board of Directors and officers shall take office on January 1 and shall hold office for one year or until such subsequent date as their successors shall be elected and take office.
ARTICLE 12: AMENDMENTS
Section 12.1 Amendment Upon Majority Vote of Membership or Majority Vote of the Board of Directors.
a. These Bylaws may be amended by a majority vote of the members present and qualified to vote at any meeting at which a quorum is present, provided the substance of such proposed amendment or amendments shall be plainly stated in the call for the meeting. In the alternative, these Bylaws may be amended by a majority of those members voting in a ballot presented to members by mail.
b. These Bylaws may be amended by the Board of Directors at any meeting at which a quorum is present, provided the substance of such proposed amendment or amendments shall be plainly stated in the call for the meeting. Such director-proposed amendment shall require an affirmative vote of the majority of the Board of Directors and shall not address the following items, which shall only be amended by majority vote of the members:
i. Regular election of the Board of Directors by the members;
ii. Number of Directors on the Board of Directors;
iii. What constitutes a quorum for purposes of Board, and Board Committee action.
Section 12.2 Notice. Notice of all meetings at which amendments are to be considered shall be mailed to every member eligible to vote at least seven calendar days prior to the meeting.
ARTICLE 13: MISCELLANEOUS
Section 13.1 Disputes. Disputes arising from or in connection with these Bylaws shall be handled with Dispute Resolution processes, and not litigation.
Section 13.2 Notices. Unless otherwise provided herein, all notices referred to in these Bylaws may be given publication in the official Council newsletter or by written notice by personal delivery or by mail addressed to the persons entitled to receive the same at their address as shown on the records of the Council. Except as otherwise set forth herein, all notices shall be mailed or delivered at least fifteen days before the date of the meeting.
Section 13.3 Seal. The Board shall adopt the official seal of the Council.
Section 13.4 Construction and Definitions. Unless the context requires otherwise, the general provisions, rules of construction and definitions in the California Nonprofit Corporation Law shall govern the construction of these bylaws. Without limiting the generality of the preceding sentence, the masculine gender includes the feminine and neuter, the singular includes the plural, the plural includes the singular, and the term “person” includes both a legal entity and a natural person.
ARTICLE 14: INDEMNIFICATION
Section 14.1 Definitions. For the purposes of this Article14, the following definitions shall apply:
a. Agent means any person who is or was a director, officer, employee or other agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise, or was a director, officer, employee or agent of a foreign or domestic corporation which was a predecessor corporation;
b. Proceeding means any threatened, pending or completed action or proceeding, whether civil, criminal, administrative or investigative;
c. Expenses includes without limitation attorneys’ fees and any expenses of establishing a right to indemnification under Sections 14.4 or 14.5(b); and
d. Law means the California Nonprofit Public Benefit Corporation Law. Section 14.2 Indemnification. The corporation shall, to the maximum extent permitted by the Law, have power to indemnify each of its agents against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact that any such person is or was an agent of the corporation and shall likewise have power to advance to each such agent expenses incurred in defending any such proceeding to the maximum extent permitted by the Law.
Section 14.3 Indemnification in Actions by Third Parties. The corporation shall, to the maximum extent permitted by law, indemnify and person who was or is a party or is threatened to be made a party to any proceeding, (other than an action by or in the right of the corporation to procure a judgment in its favor, an action brought under Section 5233 of the Law, or an action brought by the Attorney General or a person granted relator status by the Attorney General for any breach of duty relating to assets held in charitable trust) by reason of the fact that such person is or was an agent of the corporation, against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with such proceeding if such person acted in good faith and in a manner such person reasonably believed to be in the best interests of the corporation and, in the case of a criminal proceeding, had not reasonable cause to believe the conduct of such person was unlawful. The termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent shall not, of itself, create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in the best interests of the corporation or that the person had reasonable cause to believe that the person’s conduct was unlawful.
Section 14.4 Indemnification in Actions by or in the Right of the Corporation. The corporation shall, to the maximum extent permitted by law, indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action by or in the right of the corporation, or brought under Section 5233 of the Law, or brought by the Attorney General or a person granted relator status by the Attorney General for breach of duty relating to assets held in charitable trust, to procure a judgment in its favor by reason of the fact that such person is or was an agent of the corporation, against expenses actually and reasonably incurred by such person in connection with the defense or settlement of such action if such person acted in good faith, in a manner such person believed to be in the best interests of the corporation and with such care including reasonable inquiry, as in ordinarily prudent person in a like position would use under similar circumstances. No indemnification shall be made under this Section 14.4:
a. In respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation in the performance of such person’s duty to the corporation, unless and only to the extent that the court in which such proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for the expenses which such court shall determine;
b. Of amounts paid in settling or otherwise disposing of a threatened or pending action, with or without court approval; or
c. Of expenses incurred in defending a threatened or pending action which is settled or otherwise disposed without court approval, unless it is settled with the approval of the Attorney General.
Section 14.5 Indemnification Against Expenses. To the extent that an agent of the corporation has been successful on the merits in defense of any proceeding referred in Sections14.3 and 14.4 or in defense of any claim, issue or matter therein, the agent shall be indemnified against expenses actually and reasonably incurred by the agent in connection therewith.
Section 14.6 Required Determinations. Except as provided in Section 14.5 any indemnification under this Article 14 shall be made by the corporation only if authorized in the specific case, upon a determination that indemnification of the agent is proper in the circumstances because the agent has met the applicable standard of conduct set forth in Sections 14.3 or 14.4 by:
a. A majority vote of a quorum consisting of directors who are not parties to such proceeding; or
b. The court in which proceeding is or was pending, upon application made by the corporation or the agent of the attorney or other person rendering services in connection with the defense, whether or not such application by the agent, attorney or other person is opposed by the corporation.
Section 14.7 Advance of Expenses. Expenses incurred in defending any proceeding may be advanced by the corporation prior to the final disposition of such proceeding upon receipt of an undertaking by or on behalf of the agent to repay such amount unless it shall be determined ultimately that the agent is entitled to be indemnified as authorized in this Article 14.
Section 14.8 Other Indemnification. No provisions made by the corporation to indemnify its directors or officers for the defense of any proceeding, whether contained in the Articles, Bylaws, a resolution of members or directors, an agreement or otherwise, shall be valid unless consistent with this Article14. Nothing contained in this Article 14 shall affect any right to indemnification to which persons other than such directors and officers may be entitled by contract or otherwise.
Section 14.9 Forms of Indemnification Not Permitted. No indemnification or advance shall be made under this Article 14 except as provided in Sections 14.5 or 14.6(b) in any circumstances where it appears:
a. That it would be inconsistent with a provision of the Articles, these Bylaws, or an agreement in effect at the time of the accrual of the alleged cause of action asserted in the proceeding in which the expenses were incurred or other amounts were paid, which prohibits or otherwise limits indemnification; or
b. That it would be inconsistent with any condition expressly imposed by a court in approving a settlement.
Section 14.10 Insurance. The corporation shall have power to purchase and maintain insurance on behalf of any agent of the corporation against any liability asserted against or incurred by the agent in such capacity or arising out of the agent’s status as such whether or not the corporation would have the power to indemnify the agent against such liability under the provisions of this Article 14, provided, however, that a corporation shall have no power to purchase and maintain such insurance to indemnify any agent of the corporation for a violation of Section 5233 of the Law.
Section 14.11 Non-applicability to Fiduciaries of Employee Benefit Plans. This Article 14 does not apply to any proceeding against any trustee, investment manager or other fiduciary of an employee benefit plan in such person’s capacity as such, even though such person may also be an agent of the corporation as defined in Section 14.1. The corporation shall have power to indemnify such trustee, investment manager or other fiduciary to the extent permitted by the subdivision (f) of Section 207 of the California General Corporation Law.